Mid-Day ETF Update: ETFs, Stocks Continue to Tumble on Weak Earnings, Renewed Europe Debt Crisis Jitters

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Active broad-market exchange-traded funds at mid-day:

SPDR S&P 500 ( SPY ): -1.16%

Financial Select Sector SPDR ( XLF ): -1.68%

iShares MSCI Emerging Markets Index ( EEM ): -1.81%

iPath S&P 500 VIX Short Term Futures ( VXX ): +6.08%

PowerShares QQQ Trust, Series 1 ( QQQ ): -0.26%

Broad Market Indicators

Broad-market exchange-traded funds, including SPY, IWM, IVV and others, are still in negative territory. Actively traded PowerShares QQQ ( QQQ ) is down 0.26%.

U.S. stocks have settled firmly in the red with the industrial sector leading the declines with disappointing earnings from chemical manufacturer Du Pont (DD) and multinational conglomerate 3M (MMM). Earnings in general have been weak. Concerns about Europe's debt crisis have once again been stirred after Spain's and Italy's borrowing costs declined, and these worries have gained more traction following reports that Spain may not hit its deficit target this year, according to Market Watch. Dow Jones Industrial Average, which slipped more than 250 points, is now off 220.82 points or 1.67%.

Winners and Losers

Financial -

Select Financial Sector SPDRs ( XLF ) is down 1.7%. Direxion Daily Financial Bull 3X shares (FAS) is down 4.65%. Its bearish counterpart, FAZ, is up 4.7%.

Among financial stocks, Regions Financial (RF) is down 8% after it reported Q3 earnings of $0.22 per share, compared with the prior-year period's $0.20 per share. Analysts polled by Capital IQ were expecting EPS of $0.20. Revenues were $1.35 bln, down 1% from $1.345 bln in the same quarter last year. The Street view is $1.36 bln.

Industrial -

Industrial ETFs continue to slip lower: Vanguard Industrials (VIS), down 1.1%; iShares Trust Dow Jones U.S. Industrial Sector Index Fund (IYJ), down 1%; and Select Sector SPDR-Industrial (XLI), down 1.1%.

In earnings news, Du Pont (DD) is down 8.5%, adding to earlier losses of 6%, after it today reported Q3 earnings of $0.44 per share, ex one-time items, versus the Capital IQ consensus of $0.49. Revenues were $7.39 bln, versus the analyst estimate of $8.17 bln. The company lowers its FY12 EPS guidance to $3.25 - $3.30, ex non-recurring items, from the prior outlook of the low end of $4.20 - $4.40. Analysts are looking for $3.99 in EPS. DD also said that it will implement a restructuring plan that will include eliminating about 1,500 postilions globally in the next 12 - 18 months.

Commodities -

Crrude slipped lower, down 2.66% while natural gas was up 1.72%. United States Oil Fund (USO) is down 3.5%. United States Natural Gas Fund (UNG) is up 2.3%.

Gold and silver were lower, down 0.94% and 1.34% respectively. Among rare metal funds, SPDR Gold Trust (GLD) is down 1.2%; iShares Silver Trust (SLV) is down 2%.

Healthcare -

Healthcare ETFs continue to slip into the red: Health Care SPDR (XLV), down 1.1%; Vanguard Health Care ETF (VHT), down 1.2%; and iShares Dow Jones US Healthcare (IYH), down 1.2%. Biotech ETF iShares NASDAQ Biotechnology Index (IBB) is down 1.6%.

In corporate news, Cytori Therapeutics (CYTX) has recovered earlier losses and is now up more than 1% after it announced that an investigator-sponsored and funded clinical study evaluating Cytori's cell therapy as a potential treatment for limited and diffuse cutaneous systemic sclerosis (scleroderma) has been approved to begin in France by the National Agency for the Safety of Medicines and Health Products.

Consumer -

Consumer ETFs are weaker: Consumer Staples Select Sector SPDR (XLP), down 1.29%; iShares Dow Jones US Consumer Goods (IYK), down 1.60%; and Vanguard Consumer Staples ETF (VDC), down 1.35%.

Retail ETFs are also lower: SPDR S&P Retail (XRT), down 0.7%; PowerShares Dynamic Retail (PMR), down 1%; and Market Vectors Retail ETF (RTH), down 1% after earlier hitting new year highs.

In sector news, Coach (COH) is up 9%, adding to earlier gains of more than 6% after it reported Q1 sales of $1.16 bln, vs. the analyst consensus of $1.16 bln on Capital IQ. EPS was $$0.77, ahead by a penny. The company also approved a stock buyback program of up to $1.5 bln in shares.

Power Play -

Technology -

Tech ETFs are down on continued weakness: Technology Select Sector SPDR ETF (XLK), down 0.4%; iShares Dow Jones US Technology ETF (IYW), down 0.2%; iShares S&P North American Technology ETF (IGM), down 0.74%; and iShares S&P North American Technology-Software Index (IGV), up 0.25%.

Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) is 0.9% higher and Semiconductor Sector Index Fund (SOXX) has recovered earlier losses and is now flat. SPDR S&P International Technology Sector ETF (IPK) is flat.

In sector news, Yahoo! (YHOO) has bucked the downward trend in the tech sector and even touched a new year high of $16.75. Shares are now up 6%, after YHOO CEO Marissa Mayer late yesterday led her first earnings call, reporting Q3 revenue, ex TAC, of $1.089 bln, better than the analyst consensus of $1.079 bln on Capital IQ. EPS was $0.35, vs. expectations of $0.26 per share. Earlier, shares were upgraded to Positive from Neutral at Susquehanna.

Facebook (FB) and Netflix (NFLX) are due to report their earnings results after the close. Shares are currently up 1.3% and 0.7%, respectively.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright (C) 2014 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.


This article appears in: Investing , Commodities

Referenced Stocks: EEM , QQQ , SPY , VXX , XLF

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As of 10/21/2014, 04:15 PM

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